What is the consequence of not sending a 1099 to an independent contractor? What is the implication? Penalty? There is a person that we paid something to that was an employee but is now no longer. Do we 1099 them like any other vendor?

If you paid $600 or more to an independent contractor, you must issue 1099-MISC. If you have not done this till now, do it now. Late filing penalty is $50.

What is the consequence of not sending a 1099 to an independent contractor? What is the implication? Penalty? There is a person that we paid something to that was an employee but is now no longer. Do we 1099 them like any other vendor?
You only need to send a 1099 to someone who is not an employee, who is not incorporated and to whom you paid over $600.00 in year.

If in doubt there is no harm in sending one... if you are in doubt.

Agreed; if in doubt, send the Form 1099-MISC.